Even more than usual, German businesses see trouble ahead

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The last time we checked in on German business leaders, they were in a somewhat grumpy mood. Business wasn’t bad, per se, but managers were pretty gloomy about the future. In fact, this seemed to be their natural state—confident about the present but fearful for the future.

According to the latest monthly confidence data, released today, the gap between German executives’ optimism about the present and the future is now the widest it’s been for more than a year (see chart above).

The euro zone’s prolonged malaise finally spurred the European Central Bank into action last month, and not a moment too soon. German businesses’ extensive ties to Russia are also looking shaky, with more EU sanctions against Russia reportedly in the works. The German economy is doing reasonably well, but its reliance on exports makes it uniquely sensitive to the health of its key trading partners.

It seems, then, that there are even more reasons than usual for German businesses to see trouble around the corner.